Arbitration Jujitsu: 'Sealed Settlement Offers' Add Leverage

By Gilbert A. Samberg (May 22, 2018, 1:48 PM EDT) -- The cost of arbitration, including attorneys' fees, can be substantial, commensurate with the matters in dispute. Your desire to settle a dispute that is going to arbitration is often as or more substantial. But sometimes your adversary is not willing to settle at your very rational number. What next — increase your settlement offer or reduce your demand? How about using the anticipated arbitration costs to your advantage? Consider incentivizing your adversary with a "sealed settlement offer," which could eventually make a settlement offeree pay a heavy price in such costs for miscalculation or intransigence.

The principal models for this mechanism...

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